This article was first published on Kyber Network - Medium
Kyber is a fully on-chain liquidity protocol that powers instant and secure token exchange in any decentralized application, and one of the top liquidity providers in the decentralized finance (DeFi) space. This can be largely attributed to our flexible reserve system which has the ability to aggregate a wide range of on-chain liquidity sources (reserves) and allow providers to contribute liquidity in many different ways.
For instance, many token teams and individuals set up an Automated Price Reserve (APR) for capital efficient, low slippage market making directly on Kyber, while professionals are able to utilise KyberPRO’s Fed Price Reserve (FPR) for greater control over pricing, inventory, and risk.
Kyber can also bring liquidity from other external on-chain sources, such as Uniswap, Oasis, and Bancor (more are being added over time) into our network by creating new specialized ‘bridge reserves’. The main motivation for allowing the creation of any type of reserve and bridging liquidity from multiple external providers into Kyber is to enable Kyber to be the single on-chain liquidity endpoint for takers and makers.
Ultimately, when a user requests a trade, the protocol will scan the entire network to find the reserve with the best price and take liquidity from that particular reserve. With Kyber, they can receive the best possible price (quote) for each trade most of the time, without having to go through the trouble and costs of integrating multiple systems.
We are always looking to enhance overall liquidity on Kyber while delivering a sustainable liquidity infrastructure for DeFi, and part of the process is optimizing our existing bridge reserves and creating new reserve types based on prevailing market needs. We made several updates to the bridge reserves, which we expect will help bring more liquidity and volume to Kyber.
1. Curve Finance Bridge
Kyber’s ETH-stablecoin liquidity has now ...
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Kyber Network - Medium